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Under federal laws such as the Bank Secrecy Act (BSA), U.S. citizens, residents, and business entities are required to report worldwide income, including income from foreign financial accounts and other offshore income generating assets & businesses. If you have a foreign bank account, such as an offshore checking, savings or brokerage account, you should discuss your tax filing responsibilities with an experienced tax professional, like the Santa Barbara tax lawyers and CPAs at the Tax Law Office of David W. Klasing.
We have over 20 years of experience providing award-winning tax and accounting services to individuals, corporations, LLCs, and partnerships, and have dedicated a substantial portion of our practice specifically to the area of international taxation. We can review your reporting requirements, prepare and submit FinCEN Form 114 on your behalf, and represent you effectively in any IRS audit, tax appeal, or criminal tax investigation related to undisclosed offshore accounts. Contact us online for 24/7 assistance or call our Santa Barbara office at (805) 200-4053 to arrange a reduced-rate consultation.
Note: As long as a taxpayer that has willfully committed tax crimes self-reports the tax fraud (including a pattern of non-filed returns) through a domestic or offshore voluntary disclosure before the IRS has started an audit or criminal tax prosecution, the taxpayer can be successfully brought back into tax compliance and receive a nearly guaranteed pass on criminal tax prosecution and simultaneously receive a break on the civil penalties that would otherwise apply. It is imperative that you hire an experienced and reputable tax defense attorney to take you through the voluntary disclosure process. As uniquely qualified and extensively experienced Criminal Tax Defense Tax Attorneys, Kovel CPAs and EAs, our firm provides a one stop shop to efficiently achieve the optimal and predictable results. See our Testimonials to see what our clients have to say about us!See our Non-Filer Q and A Library See our 2011 OVDI Q and A Library See our FBAR Compliance and Disclosure Q and A Library See our Foreign Audit Q and A Library
What is FinCEN Form 114?
“FinCEN” is an abbreviation for the Financial Crimes Enforcement Network, which, like the Internal Revenue Service (IRS), is an organization within the U.S. Treasury Department. FinCEN Form 114 is an information form that certain individuals and entities are required to file under a federal law known as the Bank Secrecy Act (BSA).
The purpose of FinCEN Form 114 is to report certain offshore assets to the Treasury Department, such as foreign bank accounts held by U.S. taxpayers. The broader purpose is to help the government combat offshore tax evasion, which, according to the IRS, causes an “estimated… annual revenue loss to the U.S. at a minimum of $100 billion.”
Is FinCEN Form 114 the Same as FBAR?
FBAR and FinCEN Form 114 both refer to the same form. The acronym “FBAR” is shorthand for the Report of Foreign Bank and Financial Accounts, which is simply another name for FinCEN Form 114. This should not be confused with Form TD F 90-22.1, a previous version of the FBAR/FinCEN Form 114 which is no longer in use.
What is the Difference Between FinCEN Form 114 and FATCA?
The BSA requires certain taxpayers to report offshore accounts by filing an FBAR, or FinCEN Form 114, via the online BSA E-Filing System. At the same time, a newer law called the Foreign Account Tax Compliance Act (FATCA) requires other taxpayers to report offshore assets by filing Form 8938 (Statement of Specified Foreign Financial Assets).
These requirements, though related, are separate from one another. As a result, some taxpayers need only file an FBAR, while others must file both FBAR and Form 8938. It depends on how the taxpayer is classified for tax purposes, along with the type and value of the taxpayer’s foreign assets, as follows:
- Classification for tax purposes. “U.S. persons” must file FBAR (including U.S. citizens, resident aliens, and business entities), whereas “specified entities” or “specified individuals” must file Form 8938 (including the aforementioned taxpayers, plus non-resident aliens).
- Type of assets. Only certain types of foreign assets or financial accounts are reportable for purposes of FBAR. For example, foreign partnership interests must be reported on Form 8938, but are not subject to FBAR reporting
- Value of assets. FBAR requirements are triggered once the aggregate value of assets exceeds $10,000. The FATCA threshold is higher at $50,000.
Who Should File FinCEN Form 114?
You may be required to file FinCEN Form 114 if you are a U.S. person with signature authority over, or financial interest in, a foreign bank account or other reportable assets. Keep in mind that taxpayers affected by FBAR filing requirements may also be impacted by Form 8938 filing requirements under FATCA. Retirees living abroad, military servicemembers, frequent business travelers, dual citizens, “Accidental Americans,” international business owners, U.S. expats, and green card holders are just a few examples of taxpayers who can be affected by FBAR and/or FATCA regulations.
When is FinCEN Form 114 Due?
FinCEN Form 114 is due on April 15, unless a federal holiday or weekend disrupts the normal government schedule for processing FBARs. Taxpayers qualify for an automatic FBAR filing extension of up to six months, moving the extended FBAR deadline to October 15.
International FinCEN Form 114 Combo Tax Lawyer + CPA in Santa Barbara, CA
If you have failed to report foreign assets or offshore bank accounts by filing FinCEN Form 114, you should review your options with an international tax law attorney right away. There may still be time to participate in the IRS’ updated voluntary disclosure procedures, but the longer you delay action, the greater degree of risk you incur. For a reduced-rate consultation, call our Santa Barbara office 24 hours at (805) 200-4053, or contact the Tax Law Office of David W. Klasing online.
Please note all meetings at our Santa Barbara tax office are by appointment only.
Note: If you have concerns about the privacy of our initial or subsequent communication and are unable to easily travel to our Irvine / Orange County Main Office, consider scheduling a GoToMeeting to safely and securely establish an initial or maintain an existing attorney client relationship. With end-to-end encryption, strong passwords and top-rated reliability, no one is messing with your meeting. To schedule a reduced rate initial consultation via GoToMeeting follow this link. Call our office and request a GoToMeeting if you are an existing client. We are generally happy to travel to any of our appointment only satellite offices for a subsequent meeting in appropriate circumstances once a relationship is established via a signed engagement letter and the payment of an initial retainer or where enough retainer is available where a current client to cover the reasonable travel time and time required for the meeting.
Will it cost me more to hire the Tax Law Offices of David W. Klasing, who’s main office and the vast majority of the firm’s staff is located in Irvine California, but an appointment only Satellite office is close to my location, as opposed to a local company? Absolutely not! See our policies that address this issue here
